Feb 27, 2017

How to Feed a Monster (Leading in Elite Organizations)

In the decade that I've spent coaching senior leaders and teaching MBA students at Stanford, I’ve worked with hundreds of people associated with elite organizations, from blue chip professional service firms to high-profile technology companies. Many of my clients run these organizations, and my work with them involves improving their own effectiveness and fulfillment as leaders, managing key relationships and team dynamics, and shaping company culture. Other clients have transitioned from one elite organization to another, and my work with them has involved better understanding their needs and values as a professional as well as the conditions under which they do their best work, so that they can choose the opportunity that will be the best fit for them. And most of my students are either on a similar path or hoping to get there--the ability to gain superior access to such opportunities is one of the reasons they came to business school in the first place.

In the process I’ve reached a set of conclusions about how elite organizations operate, with a particular focus on the internal dynamics that cause so much stress for leaders and future leaders like my clients and students. These forces aren’t the result of anyone’s bad intentions, but they’re not random accidents, either—there’s a method to the madness. And a better understanding of these dynamics can allow leaders to successfully occupy roles within elite organizations while also maintaining their health, well-being and sanity.

One way to measure an organization’s status is by the level of demand for associated positions and opportunities—the more competitive this process, the more elite the organization. The high demand for leadership roles at elite organizations is a powerful force with significant implications for the dynamics discussed here. And one result is that many of the talented people seeking these positions have less leverage than they would enjoy elsewhere, and are willing to make concessions that they would not make for an organization of lower status.

On occasion this involves a literal trade-off in compensation—people accept less generous terms in exchange for the prestige of being associated with the elite organization. But in many cases elite organizations attract top-level leadership talent on the basis of exceptionally competitive compensation, and then the trade-offs are more complex and subtle. While the material rewards may be fulsome, the hours can be grueling, the pace intense, and the culture unsympathetic. But in almost all situations the elite organization levies some sort of tax on its leaders—something is extracted in exchange for the desired opportunity.

These trade-offs and taxes are critical elements in the relationship between an organization and the leaders who inhabit it. They signify that the association is provisional and contingent upon a leader’s willingness to make concessions. The actual degree of contingency is unclear—it is rarely articulated and usually just suggested—but it is a condition that has far-reaching ramifications. Many leaders within an elite organization feel anxious at the possibility of losing their position--not because they fear unemployment, but because their work is such an important part of their identity. These individuals are also typically strongly motivated high-performers—people I call “happy workaholics.” As a result, leaders in elite organizations can readily collude in undermining themselves. To be clear, this is rarely the result of an intentionally exploitative management strategy. Rather, it’s the inevitable consequence of the intersection of the organization’s elite status as a source of leverage and each individual leader’s combination of anxiety and motivation.

A similar process within elite organizations stems from the competition they face from outside. The position occupied by the elite organization is a desirable one, and it must be defended against others who would claim it. This has numerous consequences for its leaders. An atmosphere of frantic urgency can surge up in response to crises, both real and imagined. There is often a heightened sense of importance regarding the organization’s mission and the necessity of its success in staving off competitors. As a result, leaders in elite organizations operate most of the time in conditions of mild to severe stress—there is rarely, if ever, a sustained sense of calm or ease.

Again, it’s important to acknowledge the ways leaders collude in creating these conditions. Leaders in elite organizations tend to be highly conscientious with a strong need to have impact and make meaningful contributions. These drives are major motivators that attract talented leaders to elite organizations in the first place. And a result of these factors is that leaders internalize the importance of the organization’s mission and feel personally responsible for its success in overcoming crises and beating the competition. The stress of operating in such an environment may be regrettable, but it becomes easier to accept when it can be justified on this basis.

Subordinates and outsiders often imagine that leaders are not subject to these dynamics. This is in part because leaders appear to be in control, but that is an illusion that comforts both leaders and subordinates. In truth power within elite organizations tends to be dispersed among multiple stakeholders who are constantly engaged in struggles to maintain it. This helps to preserve the organization’s continuity and allows it to survive the occasional leadership crisis with minimal impact on its status. But a challenge this poses for leaders is that their sphere of authority is typically much smaller than it appears to subordinates and outsiders. The imbalance between the responsibility elite leaders feel (or that others impose upon them) and the actual authority they possess is itself yet another source of stress.

In my experience almost every leader in an elite organization, up through the most senior levels, faces some version of these challenges. So what can be done? Here are five strategies:

1. Accept Reality Gracefully

There’s a powerful scene in David Simon’s dramatic series The Wire in which an anxious store security guard pleads with a dangerous gang leader who’s just shoplifted, asking him to appreciate the difficult situation in which the guard now finds himself. The gang leader is unmoved. “You want it to be one way,” he murmurs, “but it’s the other way.” There’s a lesson here for leaders in elite organization. They may feel frustrated or upset by the dynamics described above, and they may yearn for things to be different—and yet this state of affairs is both rational and predictable. You want it to be one way, but it’s the other way--and it’s essential to accept this reality. This can pose a particular challenge for leaders facing a gap between subordinates’ expectations and the limits on their own ability to alter these dynamics—accepting reality may be perceived by others as indifference to dysfunction. It’s important for leaders to actively express empathy for the consequences of these dynamics without creating expectations that they will be able to eliminate them.

2. Pursue Change Thoughtfully

Failing to recognize that the dynamics described above spring from the fundamental nature of elite organizations is a form of magical thinking, but accepting reality need not entail passively tolerating dysfunction or abandoning efforts to make change. As I’ve written before, Reinhold Niebuhr's Serenity Prayer is a cliché because it's true, and the quickest way to burn out as a leader in an elite organization is to reject reality and fail to recognize what can't be changed. And yet a less quick but equally likely path to burnout is to ignore all dysfunction and make no effort to bring about change. It's essential to find a healthy midpoint between these unhealthy extremes, and to do this leaders have to take some manageable risks to determine what can and can't be altered. In many circumstances this process begins with identifying one’s personal sphere of influence as a leader and working within those parameters—this may not be a fulfilling long-term approach, but it’s a starting point. In other cases there are opportunities to pursue change on a larger scale over extended periods of time. And while at key junctures leaders can bring about more fundamental transformations, it’s important to acknowledge both the likelihood of failure and its potential consequences. Elite organizations undergo radical change very rarely and usually under extreme financial duress—the leader who seeks to pursue such a transformation must act at a propitious moment.

3. Build Resilience Continuously

The strategies above can diminish the stress experienced by leaders in elite organizations, but they can’t eliminate it. Leaders must be prepared to cope with the dynamics described here on a regular basis, and this requires the cultivation of a personal sense of resilience, the ability to face challenges with equanimity and to recover from adversity over and over again. In Bouncing Back, therapist Linda Graham relates the following story from Buddhist tradition:

A master monk is meditating in a temple with other monks. Suddenly a fierce bandit storms into the temple, threatening to kill everybody. The other monks flee, but the master monk remains, calmly meditating. Enraged, the bandit shouts, "Don't you understand? I could run you through with my sword and not bat an eye!" The monk calmly replies, "Don't you understand? I could be run through by your sword and not bat an eye." [p 229]

Leaders must strive to be the master monk facing the bandit, and this requires a continuous investment in activities that build resilience, most significantly meditation (or some other form of mindfulness practice), regular exercise, and consistent sleep. Note that these activities are in fact investments in a leader’s effectiveness and not indulgences. Also note that they are important-but-not-urgent activities which require a consistent daily commitment, a process that occurs only when the leader allocates time for them and resists yielding that time to urgent-but-not-important demands (which other people will readily supply).

4. Set Boundaries Firmly

While leaders are often advised to pursue so-called “life-work balance,” a consistent theme in my coaching practice is the unhelpfulness of this concept. Leaders in elite organizations are extremely unlikely to achieve “balance,” not only because of the demands imposed upon them by the role, but also because of their own inner drives and motivations. “Happy workaholics” have little interest in living balanced lives. And even in those rare moments when balance seems both possible and desirable, it also feels precarious and difficult to sustain. This isn’t to say that leaders in elite organizations should ignore the underlying needs represented by the idea of balance, but they have to address those needs in a way that’s likely to yield results. A better approach I often discuss with clients and students is the idea of boundaries—borders that distinguish one thing from another in our lives and keep them in the right places and in appropriate amounts. Leaders in elite organizations don’t need (or even want) balance, but they can’t survive without effective boundaries. These can take many forms, such as physical or temporal separation from work, but they all rest on the leader’s ability to direct their attention away from work and toward other activities. In this process an essential task for leaders is recognizing that elite organizations will rarely set boundaries for them, because there are few incentives to do so. It’s the leader’s responsibility to identify and enforce the boundaries they need for themselves, and as with pursuing change, this requires taking some risks in order to test what can be accomplished and what cannot.

5. See Yourself Clearly

Elite leadership roles exist within powerful distortion fields. Compensation and perks allow the leader to enjoy the most luxurious of creature comforts, which are soon taken for granted. Subordinates and others typically approach with deference, which the leader can come to expect as their due. The feeling of importance, even grandiosity, that permeates the elite organization can extend to the leader’s sense of self. And should a leader remain in a senior position long enough they may even come to identify with the organization, losing sight of how truly replaceable they are. There’s a certain inevitability to these dynamics, and in many cases they’re relatively harmless. But they can be problematic when taken to extremes or when a leader’s tenure ends suddenly. Leaders can combat the effects of these distortion fields by striving to see themselves (and the world around them) more clearly:

Get out of the elite bubble and deprive yourself of some creature comforts on a regular basis to combat hedonic adaptation.

Seek out candid feedback from subordinates and peers and express appreciation for those who actually provide it.

Invest in relationships with people who know you as someone other than an elite leader and who have no investment in your leadership role.

Maintain a personal identity that transcends work, and immerse yourself in experiences that remind you of those aspects of yourself.

A leadership role in an elite organization can be a powerful source of meaning and purpose. The shared status, the ability to command and employ resources, the sense of contributing to an important mission, the opportunity to have an impact in the world, and, to be clear, the material rewards can serve to make these roles immensely gratifying. And yet these roles can also be tremendously stressful and depleting, leaving the people who hold them burned out and overwhelmed. The key is recognizing the necessity of taking responsibility for a positive outcome. Successful leadership careers don't happen by accident, and neither do fulfilling ones.